Dustin Eide returned to Bend, his hometown, for a Fourth of July holiday visit that coincided with the advent of a cashless payment system his company, CanPay, unveiled for marijuana retailers in his home state.

CanPay works like a debit card, but instead of pulling a piece of plastic from a wallet or purse, the consumer uses a smartphone with the app previously downloaded and an account set up. Eide, 36, of Seattle, said the app bridges a gap between cannabis retailers, many of whom are without access to account services like debit or credit cards, and consumers used to paying with plastic.

Because interstate banking is federally regulated, and cannabis remains an illegal drug at the federal level, many banks are reluctant to provide services to marijuana businesses in states where the drug is legal. That means most of Oregon’s cannabis industry, which sold about $360 million worth of products last year, deals in cash.

Because banking services are hard to come by at an affordable cost, marijuana businesses sometimes conceal their true nature. Often, those business lose those accounts once the bank discovers what they do.

“Our intent is to build a payment platform that affords the legitimacy of a business doing business in their own name, which is the right way, the only way to do it, really, from a transparency standpoint,” Eide, the CEO of CanPay, said Friday.

CanPay became available June 29 at six marijuana dispensaries in Portland, Oregon City and Eugene, he said. None in Bend is using the app, primarily because few have access to bank accounts needed to make the system work. Eide said more than 40 dispensaries in Washington, Colorado, Oregon, Florida and Maine accept CanPay.

He said his company, based in Littleton, Colorado, relies on guidance from the U.S. Justice and Treasury departments on dealing with states where marijuana is legal to create a legitimate cashless payment option for marijuana businesses. That guidance was laid out during the Obama administration in the Cole Memo from the Justice Department and from the Financial Crimes Enforcement Network at the Treasury Department.

“We won’t operate with someone that’s not operating inside one of those programs,” Eide said.

For cannabis retailers who have a transparent account with a bank or credit union, CanPay provides a routine debit transaction through the Automated Clearing House, or ACH, the electronic system by which U.S. banks transfer account payments. CanPay uses Safe Harbor, a Colorado bank, to route funds from the consumers’ accounts to the cannabis retailers’ accounts. Eide declined to say what financial institution CanPay is working with in Oregon to accept marijuana business accounts. CanPay charges a 2 percent fee for facilitating the retail transactions.

“One of the things that’s really important about the CanPay network is that CanPay never receives those funds,” Eide said. “We never hold those funds.”

However, the barriers to in-state banking services, even when they’re available, are still formidable, said Christina Fehrs, owner of The Good Leaf Organic Collective, a marijuana dispensary in Bend.

“The problem I ran into is the bank on our end,” she said Wednesday. “If you go to any bank, period, they won’t give you an account. I’ve had other business accounts shut down because I own a dispensary.”

Two banks and a credit union in Oregon offer banking services to marijuana dispensaries, according to a report in December to the Oregon Legislature, which did not identify the institutions. Fehrs said that opening an account at a Salem credit union that provides marijuana business accounts would cost $5,000 up front and $500 per month, along with an in-depth check of her business financial foundation.

Fehrs, who said she wants to operate transparently, wants affordable services, too.

“The fee is kinda high,” she said, and at $500 per month, “even though it is a solution, and a legitimate solution, it’s very expensive.”